Capital & Counties (Capco) saw positive momentum across its Covent Garden estate, with strong demand, high occupancy levels and rental growth last year, which has continued in 2023, its chief executive Ian Hawksworth.

Underlying net rental income increased to £57.2m (2021 restated: £48.9 million), with the landowner reporting a loss for the year of £211.8 million (2021 restated: £34.8 million profit).

The independent property valuation of Covent Garden was £1.7 billion – equal to the 2021 valuation.

In terms of leasing demand Capco said its targeted categories, including F&B luxury and premium, were among the highest performing.

“The retail and hospitality pipeline is encouraging with current leasing discussions ahead of prevailing ERV,” it said in its full year results today (1 March).

Capco is to due to complete its merger with Shaftesbury on 6 March, after it got the green light from the Competition and Markets Authority last month.

The merger will create one of the biggest landowners in London, with a combined portfolio of 40 acres, which includes the Covent Garden estate as well as parts of Chinatown, Soho and Carnaby Street.

“Despite the macroeconomic backdrop, the West End has clearly demonstrated its resilience and enduring appeal with strong recovery in footfall and customer sales ahead of pre-pandemic levels. We therefore look ahead with confidence to completing the merger of Capco and Shaftesbury on 6 March to create the leading central London mixed-use REIT, Shaftesbury Capital plc,” Hawksworth said.

“The combination creates an impossible to replicate £4.9 billion portfolio located within some of the most iconic destinations of the West End. Backed by a strong balance sheet, we aim to deliver long-term economic and social value for our stakeholders.”